Ground Breakers: Gold hits Australian dollar all time high as Ramelius says BRB just buying Breaker

Australian dollar gold price hits all time high overnight as safe haven investors pile in
3% lift in US dollar gold, knocking on the door of US$2000/oz, take AUD gold past $2900/oz for the first time. ASX miners charge
Ramelius lobs $130.7m scrip bid for Breaker Resources to grow east Kalgoorlie gold hub

The mega movers in the ASX 200 are the major gold miners, with the All Ords gold sub-index up 7.24% on a massive morning of gains for Australia’s bullion merchants.

It could be short-lived with another rate hike expected from the US Fed this week. But a global banking crisis has stirred investors to pile into the safe haven metal, a favourite of billionaire barons and backwoods doomsday preppers alike, up 3% to US$1989.25/oz.

That’s over $2900/oz in Australian dollar terms, eclipsing the all time high set in August 2020 thanks to the added factor of a falling AUD-USD exchange rate over the past year.

“Gold hit a 12-month high as investors sought safety in haven assets,” ANZ’s Felix Ryan noted.

“The banking crisis has raised expectations that the Fed will ease up on its aggressive rate hike cycle, with the market now pricing in rate cuts by the end of the year. Nevertheless, persistently high inflation will likely see another hike this week.”

Read it and (for once in the last two years gold bulls, don’t) weep.

Our tale of the tape has Northern Star Resources (ASX:NST) up 7.94% to a month high of $11.75, Newcrest (ASX:NCM) hit $25.76, up 6.4%, adding some steam for investors in Australia’s biggest gold miner as talks roll on with Newmont over a potentially improved merger deal after Newcrest’s rejection last month.

The mid-cap movers in the ASX 200 are a who’s who of gold miners.

Gold Road (ASX:GOR) rose 9.97%, with Evolution Mining (ASX:EVN) up 9.88%, Regis Resources (ASX:RRL) soaring 8.12% and Perseus Mining (ASX:PRU) up 7.78%.

Silver Lake Resources (ASX:SLR) gained 7.14% with De Grey (ASX:DEG) up 7.09%, Bellevue Gold (ASX:BGL) lifting 6.79% and Capricorn Metals (ASX:CMM) up 5.62%.

ASX gold miners share prices today:

Ramelius rides gold wave as Breaker falls to mid-tier miner

Ramelius Resources (ASX:RMS) took a major plunge into an unheralded gold field east of Kalgoorlie a couple years ago with its $181 million cash and shares purchase of Apollo Consolidated and its then 1.1Moz Lake Rebecca gold project.

A pre-feasibility study on opening what would be ~260,000ozpa miner RMS’ third WA gold hub outside its Edna May and Mt Magnet fields is due in the middle of this year.

But it has moved early to add scale with the all-scrip acquisition of Breaker Resources (ASX:BRB), adding 1.7Moz to its gold bounty via the addition of Breaker’s nearby Lake Roe gold project (32Mt at 1.6g/t for 1.7Moz).

The 1 for 2.82 offer comes at an implied price of 40c or $130.7m, a 41.7% premium to Breaker’s 10-day VWAP.

BRB has been kicking the cans around Lake Roe for several years and alongside its strategic position near the Rebecca project, also had $78m in cash sitting in the bank as of December 31 after selling its stake in the Manna Lithium Project to Global Lithium (ASX:GL1) last year.

RMS already has the support of Breaker’s board as well as major shareholders the Electron Strategic Opportunities Fund and Paulsen and Co., the latter two controlling around 19.92% of the junior’s stock.

Ramelius managing director Mark Zeptner told analysts and investors this morning the Lake Roe acquisition could materially increase the life of a future operation at Lake Rebecca.

“We’ve talked publicly about a minimum production profile of a million ounces, 10 years at 100(000oz),” he said.

“And we believe that Rebecca can deliver that.

“Obviously adding Lake Roe probably doesn’t increase that production rate.

“But ideally, (it) increases the longevity of the project, and just makes it that much more robust. Ultimately, the studies that we’re in, and we’ll consider what that means for the current studies, will tell us the answers in time.”